feature image

New Accounting Standards Upcoming Effective Dates for Private Company

In this publication, we’ve summarized the new standards that take effect in annual 2021 financial statements for nonpublic entities. Those effective dates reflect the deferral of certain major standards provided in ASU 2019-10 and ASU 2020-05.

In the next filing season, calendar year-end nonpublic entities will prepare their annual 2021 financial statements reflecting standards that took effect in 2021. The FASB has deferred the effective date of the new leases standard until 2022 and the credit losses standard until 2023 for nonpublic entities.

Early adoption is generally permitted for all of the standards summarized herein, but each ASU has specific transition guidance and early adoption may have been limited to certain periods or circumstances.

 

Accounting Standards Updates Effective for Calendar-year Nonpublic Entities as of January 1, 2021

Pronouncement

Effective Date

 

ASC 350, Intangibles - Goodwill and Other

ASU 2021-03, Accounting Alternative for Evaluating Triggering Events

Effective prospectively for annual periods beginning after December 15, 2019.

 

ASC 350-40, Intangibles - Goodwill and Other - Internal-Use Software

ASU 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract

Effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021.

 

ASC 606, Revenue from Contracts with Customers

ASC 808, Collaborative Arrangements

ASU 2018-18, Clarifying the Interaction between Topic 808 and Topic 606

Effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021.

 

ASC 715-20, Compensation - Retirement Benefits - Defined Benefit Plans - General

ASU 2018-14, Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans

Effective for fiscal years ending after December 15, 2021.

 

ASC 810, Consolidation

ASU 2018-17, Targeted Improvements to Related Party Guidance for Variable Interest Entities

Effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021.

 

ASC 815, Derivatives and Hedging

ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities

Effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. The original effective date of ASU 2017-12 was deferred by ASU 2019-10.

 

ASU 2018-16, Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting

The amendments are required to be adopted concurrently with the amendments in ASU 2017-12.

 

ASU 2019-04, Codification Improvements

The amendments that affect ASC 815 are required to be adopted concurrently with the amendments in ASU 2017-12.

 

ASC 848, Reference Rate Reform

ASU 2021-01, Scope

Effective upon issuance on January 7, 2021.

 

ASC 920-350, Entertainment - Broadcasters - Intangibles - Goodwill and Other

ASC 926-20, Entertainment - Films - Other Assets - Film Costs

ASU 2019-02, Improvements to Accounting for Costs of Films and License Agreements for Program Materials

Effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years.

 

ASC 952-606, Franchisors - Revenue from Contracts with Customers

ASU 2021-02, Practical Expedient

Effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years.

 

 

If you have questions, and need accounting advice, please don't hesitate to contact us to receive the help you need.

About the Author
H&CO